WDC and JA Urge Renewal of Kimberley Process

November 6, 2006byJCK Magazine

Eli Izhakoff, chairman of the World Diamond Council, said failure of the Kimberley Process is not an option, and he called for renewed commitment to its success from all sources. He blasted critics who said the industry is not interested in seeing a robust and effective certification scheme.

In his address Nov. 6 to the participants and observers of the Kimberley Process plenary meeting, taking place in Gabarone, Botswana, Izhakoff said, “Millions of people around the world depend on the diamond industry for their livelihoods, many of them from developing countries. Countries like Botswana, Namibia, and South Africa have used this precious natural resource to help build stable and thriving democracies, and to bring the benefits of education, healthcare and employment to their people.

“We in the diamond industry acknowledge that to ensure a sustainable future for ourselves, countries like Botswana and other diamond producing countries and, critically, those countries recovering from conflict, the industry must act responsibly and ensure that our business is both transparent and accountable. In order to achieve this we need a Kimberley Process Certification Scheme that is effective and above all credible.”

Izhakoff encouraged all Kimberley participant governments to review their own internal control mechanisms to ensure their effectiveness, especially regarding the need for periodic physical inspections of imports and exports of rough diamonds, and random sampling of traders in rough diamonds to verify compliance. He also called for statistics on the movement of rough diamonds to be made public, urging cooperation from participants. He pointed out some areas of the process in need of improvement, most notably delays in producing some reports from peer review sessions, which he called “unacceptable and damaging to the credibility of the process.”

Finally, he also underscored the need for appropriate funding for the entire Kimberley Process, and called upon participating governments to increase their oversight of the system of warranties.

“I repeat, a credible, transparent and accountable Kimberley Process, accompanied by an effective and appropriately monitored System of Warranties, is essential to the future of our industry and those economies and people who depend upon it,” he said.

Separately, Jewelers of America also issued a call to Kimberley participants at the plenary to complete the unfinished work on the process, which has been in place since January 1, 2003.

“The Kimberley Process Certification Scheme is a remarkable and unique achievement, involving the successful cooperation of many governments, non-governmental organizations, and industry,” says JA President and CEO Matthew A. Runci. “But while much has been accomplished, there are issues still to be resolved before the Kimberley Process fulfills all of its original promises. It’s time to complete the task and get the job done.”

Like Izhakoff, JA emphasized the need for better funding and better management of trading statitsitcs, and also better enforcement of controls on the movement of diamonds with a country’s borders, especially in those countries where diamonds are mined in alluvial deposits.

The Kimberley Process has been largely successful as a regulatory system, said Runci, but it does have some weaknesses and if those aren’t addressed, consumers could lose faith not only in the system and in their [jewelry] retailers, but in diamonds themselves.

“U.S. retailers are on the front lines explaining the industry’s response to the conflict diamond crisis this fall,” says Runci. (The movie Blood Diamond, which is set in Sierra Leone at the height of the conflict diamond situation, opens December 8 in the middle of holiday shopping season.)

Runci echoed Izhakoff’s stand that fixing Kimberley’s weaknesses is essential not only to retailers but also to Africans whose livelihood depends on diamonds or who may have been victimized by the illicit diamond trade in the past.